Alcoa Oil & Gas, Inc. - IADC Oil & Gas, Inc. ... Design, Analysis & Testing Drill Pipe No CP Mechanical Connections Manufacturing ... •BHA & Drillstring Design

Alcoa Oil & Gas, Inc.

IADC --DEC Technology Forum

Jeffry Lehner, Technology GM

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09/15/2014

Extending the Reach—with FarReach Drill Pipe

Yields Significant Cost Savings

Alcoa Oil & Gas, Inc.

Directional Mud Motor

Vertical Rigs

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Founded in 1888

200+ locations in 31 countries

$25B in 2013 revenue

Invented the Modern Aluminum Industry

Fortune magazine’s #1 “Most Admired” metals company1

125 years of metallics technical leadership including the original aluminum process

Alcoa has invented 95% of the aluminum alloys that are in flight today

Alcoa at a glance

Number of Employees (2013)

U.S. 26,000

Europe 17,000

Other Americas 11,000

Pacific 7,000

61,000

Alcoa Oil and Gas (AOG) business unit

Located in The Woodlands, TX (North

of Houston)

Independent business unit of Alcoa

A division of Alcoa Engineered

Products and Solutions

Cross functional team

Metals & O&G industries

Manufacturing, quality,

technology

Mission to grow oil and gas market for

aluminum alloy solutions and sub

systems

Riser

Drill pipe

Casing

Forgings, casting, tubing, sheet

& plate

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Houston, TX

O&G CustomersAlcoa Products

Drill pipe

Riser

Fall Pipe

Flush jointsExtrusions

Panels

Forgings

Accumulator

Bottles

Casings

Targeted O&G Investment in R&D

Alloy Development

Leveraging aerospace

Microstructure-process-performance

Corrosion

Seawater & CP System

Internal fluids

Coatings

Corrosion mitigation

Wear

Design, Analysis & Testing

Drill Pipe

Mechanical Connections

Manufacturing

Fusion & Solid State Welding

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No CP With CP

Seawater

Exposure

Sour H2S / CO2

Non-Sour- CO2

Drilling Mud 230F Epoxy Coatings

Carboguard 890

$10m+ Investment

Benefits with Directional Mud Motors Slide 6

• Why Using Aluminum DP?

• Torque & Drag Basics

– Friction & Contact Forces

– Weight / Buoyancy

– Stiffness

• Case Study

• BHA & Drillstring Design

• Results

• Conclusion

Ryan Directional and Alcoa Oil & Gas

Why Using Aluminum DP?

Slide 7

• Problematic

Torque & Drag & Buckling is a concern in long horizontal wells because of cumulative Friction Forces that lead to

• Excessive Torque

• Compression & Buckling (poor WOB Transfer in sliding mode)

• Limitation of the lateral extension of the well

• Solution

Reducing Friction Forces with light weight Aluminum DP

Torque & Drag Basics Contact Forces

SPE170255 • Successful Use of Mixed Aluminum-Steel Drill Pipe String In Complex

Horizontal Wells: Case Study • Stephane Menand

Slide 8

Friction Force = . Normal Force = Coefficient of friction

Reduction of Friction Forces with Aluminum DP due

to lighter weight



Slide 9

Pipe Densit

y

Weight in Air (lb/ft) Weight in 10 ppg Mud (lb/ft)

5 7/8 in. Aluminum

DP 2.80 16.6 9.5

5 in. Steel DP 7.85 23.6 20.0

Difference -30% - 52 %

Reduced Weight & Higher Buoyancy

Torque & Drag Basics Weight & Buoyancy



Slide 10

Bending Stress

As bending Stress is lower with Aluminum

DP, the contribution of stiffness to normal

force is reduced, leading due a reduction

of Torque & Drag

Torque & Drag Basics Stiffness

Slide 11

Torque & Drag Basics Aluminum DP

Reduced Stiffness +

Lighter Material +

Higher Buoyancy

= Less Torque & Drag

Better WOB transfer (Higher ROP)

Case Study in Shale Play



Slide 12

Case Study in Shale Play BHA & Drill Pipes



Slide 13

BH

A

180 joints of ADP (~ 30% of the total length)

Comparison between Mixed SDP-ADP string and SDP String

Same PDC bit - Same BHA (Steerable Mud Motor)



Slide 14

Well 1

Steel DP String

Well 2, 3, 4

Mixed Steel & Aluminum DP

Case Study in Shale Play Trajectory

Lateral length = ~ 6,000 – 6,500ft



Slide 15

Results Torque off Bottom

Mean Torque Reduction = 25%

SDP

ADP



Slide 16

Results Hook Load While Sliding

Steel DP String

Real WOB while sliding in the lateral section section = 5-10 klbs



Slide 17

Results Hook Load While Sliding

Mixed Steel & Aluminum DP

Real WOB while sliding in the lateral section section = 15-20 klbs



Slide 18

Results ROP

1

2

3

4

Mean ROP increase = +43% (sliding)

+ 8% (rotary)

SDP

ADP



Slide 19

Conclusion

• Successful Use of Mixed ADP-SDP

String In Complex Horizontal Wells

• Field results and simulations show that:

– Torque was reduced by 25%

– WOB transfer was better (about +10 klbs at the

bit) while sliding

– ROP was increased by 43%



Slide 20

Conclusion

ADP associated with a steerable mud motor could be an

economically and technically viable solution to compete with

RSS in shale gas plays

The Problem: Can’t Achieve your Goal without a Bigger Rig

Your costs rise rapidly… Capital

Operating Costs

Your footprint increases… Permitting fees go up

More land space

More impact on roads, environment

Transport costs rise

More energy costs

Larger crews

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You need to drill farther to reach your goal…

The traditional answer….bring in or create a bigger rig (if you can). The Result….

What if…the answer was not a bigger rig?

What if: You could use the

same rig that you are currently but reach 30%-40% farther?

You could go to a smaller rig and achieve the same as the big rig?

You can’t bring in a bigger rig but, using the existing rig, could now achieve your goal?

If you could, you

would:

Save Money

Save Time

Lower your

environmental footprint

Produce hydrocarbons

previously not

accessible

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The Cost of THE BIGGER RIG Q2 2010 US Land

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Mid

co

n

Ro

ck

ies

45% G

ulf

Co

ast

49%

36%

Ark

LaTex

40%

69%

ST

X

Perm

ian

54%

% Increase in Rig Cost 750 HP Rig -> 1500 HP Rig

*The Land Rig Newsletter “Day Rate Report”, 2Q 2010, Volume 20, Number 2

Example: +$75000 additional

cost -10 Day Well using a larger rig in South Texas:

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Case Study: Eclipse Vertical Air Drilling

Rig: Schramm T200XD Carrier Mounted Rig

Hookload: 200,000#

Limitation: BHA & 4.5” SDP 19.5#/ft,

Typically 5800’ in straight vertical

Hookload was maxed out

15 degree angle

Objective: Drill to 6410’

Solution: 3100’ of 4.5” steel pipe

and adding 3300’ aluminum drill pipe

Benefits: Reached TD of 6410’

Achieved 50,000’ overpull margin

Half from weight reduction of pipe

Half from reduced side load in deviated well

$150,000 cost savings per well

Conclusion

Significant opportunities to save money

Rapidly gaining acceptance

Contact:

Jeffry Lehner

Technology GM

281-292-3310

Abdias Alcantara

Business Development

281-292-8325

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Alcoa Aluminum Drill Pipe - AADP®

Optimized tube geometry Tapered upset tube

Strength-to-weight

Mechanical processing

Range 2/3 (long length)

Connection you can trust Thermal/interference fit

Pressure tight 5000 psi

Proven in the field 30+ yrs

Reynolds/Reed/Baker lineage

Proven Alloy/Temper T6 Peak strength temper

2014 High strength 58 YTS

Good corrosion resistance

Good fatigue resistance

Reynolds lineage

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AADP can reduced tendency to buckling

In mixed string deployment the reduced weight & torque of AADP compliments

steel pipe to reduce buckling tendency.

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ADP Outperforms SDP in Fatigue!

Recent AADP customer reference list

Shell Brunei Petroleum – Drill pipe, Offshore Brunei: Produced 10,000 ft of pipe for BSP for use offshore Iron Duke field in directional and horizontal ERD wells. Drilled May 2012 and December 2013

STOS—Shell Todd New Zealand—completed ERD well from work over rig, extending reach of rig, 3435’ added length, 30% less torque, drilled December 2013

Eclipse—Ohio, extended vertical drilling reach of Schramm 200 rig by 3000’, enabling lower cost rig to complete vertical section. Hook load reduction up to 50%

Penn Virginia—Eagle Ford shale in south Texas. 30% improved ROP enabling use of lower cost mud motor directional steering as opposed to 3X more expensive RSS. May 2014

Maersk—work over of 28,000’ lateral, allowed extension of re-entry of uncased laterals, cementing and abandonment, allowing new parallel well to be drilled, and improving productive capacity of field. May 2014

Fugro McClelland GeoSciences – Drill pipe, Offshore Brazil, Gulf of Mexico: Produced 6,000 ft of pipe for use in offshore survey work. Depths of 8,000 to 10,000 ft. Fugro has existing Alcoa (Reynolds design) pipe wth up to 20 year of service.

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Documents

Alcoa Oil & Gas, Inc. - IADC Oil & Gas, Inc. ... Design, Analysis & Testing Drill Pipe No CP Mechanical Connections Manufacturing ... •BHA & Drillstring Design